Room charges of the star hotels in the country have unexpectedly gone down. It is, in fact, below the level of charges in 2014 as rate undercutting among hotels is in an increasing trend along with the entry of new players in the market.
As the new hotels have started offering relatively cheaper rates for rooms as compared to established players, room charges have gone below what it was before the earthquake, according to hoteliers.
Undercutting in room rates is due to the slow growth in tourist arrivals as compared to the availability of rooms in tourist standard hotels.
According to Binayak Shah, general secretary of the Hotel Association Nepal (HAN) — umbrella association of the tourist standard hotels in the country — hoteliers have been adding various offers in the room charges to attract tourists and the current trend that is being witnessed may lead towards unhealthy competition in the domestic hotel industry.
Normal room charges in five-star hotels stand at around $140 to $150 per night. However, hotels have started providing hefty discounts on the room rates along with the entry of new players.
Shah of HAN said that the country has to attract more tourists to end the current trend. “Along with increased availability of rooms, the country needs to bring in more tourists to end the current trend,” he stated.